Compute the rate of return for each division using the

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Selected operating data on the two divisions of York Company are given below

 

Division

 

Eastern Western

 

Sales $1,000,000 $1,750,000

 

Average operating assets $500,000 $500,000

 

Net operating income $90,000 $105,000

 

Property, plant, and equipment $250,000 $200,000

 

1. Compute the rate of return for each division using the return on investment (ROI) formula stated in terms of margins and turnover.

 

2. Which divisional manager seems to be doing the better job? Why?

Reference no: EM13575419

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